An American website which auctions unpaid internships for thousands of dollars – and plans to expand to the UK – has refused to answer Graduate Fog’s questions about how its business model fits with the National Minimum Wage law in this country. It insists it offers “fun, unique experiences” and that the proceeds are helping to “end to global poverty.”
Charity Buzz told the BBC last month that it intends to open offices in the UK, following recent successes with offering London-based internships through the website. But when Graduate Fog questioned them about the details of this plan, their spokesperson refused to answer most of my questions.
However, they did reveal that their company takes 20% of the money made at auction – and insisted that any advertised internships were created specifically for the purposes of auctioning for charity, so they “do not take the place of available internship jobs offered by the company to potential employees.” They said that their internships last from one day to one month – although it appears from their website that they offered an eight-week placement at a New York casting agency in March 2011.
In recent months, Charity Buzz has auctioned over 250 US-based internships. The highest price tag was for Sir Richard Branson and hip-hop mogul Russell Simmons, which sold for £53,000. A placement at Jay-Z’s production company Roc Nation sold for £3,100.
Sex and the City stylist Patricia Field has also offered a one-month internship (estimated value $5,000) – as has Rolling Stone magazine (estimated value $5,000). Elle magazine (US), Cosmopolitan magazine (US) and W magazine have each offered one-week internships (estimated values $5,000, $5,000 and $1,500 respectively). The fashion brand H&M has also offered a one-month internship in their marketing department (estimated value $2,500).
The website is currently offering a two-week internship with American Football team the New York Jets (estimated value $20,000), a one week internship at Newsweek (estimated value $2,500), a four-week internship at The Hamptons magazine (estimated value $2,000).
Charity Buzz’s chief executive Coppy Holzman (yes, seriously) told the BBC:
“I sleep really well at night knowing that we provide unusual access to people that do have deep pockets but it’s an opportunity for them to give back.”
I am not an expert on the legal situation in the US when it comes to unpaid internships – and make no suggestion that any of these brands or individuals (including Charity Buzz) has done anything illegal in offering these internships within the US. However, I have serious concerns about how opportunities like this would fit with our National Minimum Wage laws, should the company expand to the UK. The law here states that anybody doing the job of a ‘worker’ (with set hours and responsibilities) must be paid at least £5.93 an hour if they’re over 21.
This is what happened when I put my questions to Charity Buzz:
To: Charity Buzz
From: Graduate Fog
Re: Press comment about Charity Buzz?
My name is Tanya de Grunwald and I run a website for job-seeking graduates in the UK, called Graduate Fog
I read with interest a recent piece about Charity Buzz on the BBC website and would like to request some more information about your company’s plans to auction more internships in the UK.
The spread of unpaid internships is one of the biggest issues among my users. We believe that these internships exploit those who do them and exclude those who can’t afford to do them. We are concerned that they are becoming longer and longer, with less and less of a chance of a job at the end of them. We are now seeing evidence that unpaid internships are no longer leading to junior, paid jobs, they are now actually replacing junior, paid jobs.
I would like to ask the following questions:
1) If Charity Buzz plans to auction more internships in the UK, have you considered how these unpaid internships fit with the UK’s National Minimum Wage legislation? Our laws say that anybody who fits the criteria of a ‘worker’ (with set hours and responsibilities, not work shadowing or doing the placement as part of their course) must be paid at least the NMW, which is £5.93 an hour for over-21s. Depending on what kind of work the internships you offer involve. you could be in danger of breaking that law, which can lead to a prosecution and a large fine. Is this something you have considered?
2) Even if those individuals who do your internships do not qualify as ‘workers’ (eg if their placements are more like work shadowing), have you considered that those who take these opportunities will be gaining an extreme advantage over their poorer peers, who cannot afford to pay thousands of pounds/dollars for the opportunity?
3) Can you clarify your business model? Does Charity Buzz take a percentage of the sale price – and if so how do you justify this?
4) Has Charity Buzz arranged any unpaid internships within the UK to date? If so, who were they with and what duties (if any) did these interns perform during their placement?
I look forward to hearing from you
With many thanks
A few days later, this reply arrived:
To: Graduate Fog
From: Charity Buzz
Re: Re Press comment about Charity Buzz
Hi Tanya –
Thank you for reaching out to us with your questions. charitybuzz works with more than 1,000 nonprofits to help them raise funds by introducing them to our 60,000 affluent bidders around the globe. The nonprofits we work with are able to raise significantly more funds by working with us, giving many of them a lifeline to continue their operations in the face of a tight economic environment. Since launching six years ago, we’ve raised more than 50 million dollars for nonprofit organizations, including UNICEF, Doctors without Borders, the Global Poverty Project, the RFK Foundation for Justice and Human Rights, and many more charities of all types and sizes.
80 percent of the final price of an auction goes directly to the nonprofit organization associated with that item. charitybuzz’s 20 percent fee includes comprehensive auction services for the nonprofit, including securing items and experiences, marketing, promotions and social media, shipping and reconciliation, web site design and collateral design and more. There are no upfront fees.
Our auctions include celebrity meet and greets, VIP concert tickets, television and film set visits, sports, art, education, health, music, fashion and business experiences.
The internship “positions” we auction on our site are specifically created by companies for these auctions as a way to help nonprofits as part of their corporate philanthropy. These “positions” do not take the place of available internship jobs offered by the company to potential employees. The majority of the internships charitybuzz auctions are for the span of one day, one week or one month, are only for college students and are not perpetual positions. They are simply fun, unique experiences, like many other auction items on our site, that may also provide a learning opportunity.
By auctioning these unique experiences and learning opportunities, we are raising funds for important social causes like worldwide human rights, an end to global poverty, environmental sustainability, healthcare access for the underprivelaged, arts education in urban areas, disaster relief, medical research for life-threatening diseases, and hundreds more.
[NAME DELETED BY GRADUATE FOG]
Director of Communications
Fifteen minutes later, I wrote back:
Thanks for this.
While the information that you have provided seems to answer Question 3, I am not convinced that your response answers Questions 1, 2 or 4, which are probably the most important to my users. Perhaps you would like to re-read my initial email and send another email which addresses them? If I publish what you have just sent I fear most of my users will just think you have side-stepped the more awkward questions.
I didn’t hear anything for couple of days, so I wrote again:
Are you planning to supply any further comment on this?
And this came back:
To: Graduate Fog
From: Charity Buzz
No, thank you.
[NAME REMOVED BY GRADUATE FOG]
I remain extremely confused and concerned about the ethics behind auctioning unpaid internships for charitable causes. I also have serious questions about how this would fit with the UK’s National Minimum Wage laws if companies like Charity Buzz chose to expand over here. So it would have been nice if they’d had the courtesy to answer them…
*Should internship auction websites be banned?
Are these placements okay, as long as the interns aren’t proper work during their internships? Or do they still give an unfair advantage to those super-rich young people whose parents are able to buy them these opportunities?